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#GETITGIRL Lesson No 30

Black Friday and Cyber Monday just happened.  We knew it was coming – it comes every year now, yet we didn’t prepare.  Many of us thought that we wouldn’t give in to temptation, but many of us underestimated the seductive power of a good deal.

Now I wanted to post this after the major sales for a reason, because I wanted you to enjoy one last Shopping Spree before I broke the bad news.  Most people can’t Afford Black Friday. In fact, most people can’t afford any shopping spree they go on.  You get your pay cheque, see a number and think, “I can buy a new clutch with this and still have money to spare!” and you push all our bills to next pay cheque. Worse yet, you charge it to your credit card, knowing that you make more than enough to pay the bills and also make small payments every month until that debt goes away.

Let’s say you wanted a new LV.  At around $1500 plus taxes you think, “a couple pay cheques and I can have that paid off easy”, so you charge it. The next month you don’t pay it off like you thought you would because it’s birthday season and you had to buy some gifts, go out for dinner and pay for drinks(obviously).  It’s not so easy to pay that bag off after all. So how much does that bag really cost you?  If your credit card interest rate is 19% (which many start off at nowadays), and you only make a minimum payment of interest plus 1% of the balance every month, it would take you 14 years to pay off the balance of that bag and you would’ve paid over $2000 in interest.  That’s the cost of another bag! Let’s say you were a bit more disciplined and you paid $100 into it every month.  It would still take you almost 2 years and over $300 in interest to pay it off, plus whatever interest you accumulated from charging other things to your card.  If your visa statements don’t give you an estimate of how long it takes you to pay off your balance, there’s a calculator you can use at bankrate.com here.

Food is another example. We at shop eat love are major fans of treatin’ yo’self every so often and as you can see from our Instagram, we are guilty of a little binge here and there, but those little $20-$30 meals add up. It’s deceiving because the small amounts make you think it’s affordable, until 5 pounds later you realize you can’t pay for car insurance.

If you would rather make smaller payments to your debt because shopping just feels so good, stop and think; just because you can buy it, doesn’t mean you can afford it.  Unless your house burned down, you don’t need a new dress for the party, the latest phone, or a new handbag. Delay the gratification and wait to buy it when you actually have your sh*t together.The illusion that you can afford all the things you want simply because you can make payments towards them is dangerous and costly.  There are more important ways your money needs to work for you than satisfying that crave or that shopping tick. So,relax and wait.  If you do things right, you will be able to afford that item later, but you gotta break some bad habits first. \\//



This post first appeared on SHOP EAT LOVE, please read the originial post: here

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#GETITGIRL Lesson No 30

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